India's outstanding debt burden will increase by 10.7% to Rs 43.52 lakh crore by March 2012 on account of high levels of market borrowing.
Outstanding debt liability of the government would rise from Rs 39.30 lakh crore at the end of the current fiscal to Rs 43.52 lakh crore as on March 31, 2012, an increase of 10.7%, according to the Budget papers tabled yesterday in Parliament.
Internal debt comprising loans raised in the open market, special securities issued to the Reserve Bank, compensation and other bonds etc, will increase to Rs 41.81 lakh crore at the end of March 2011-12 compared to Rs 37.74 crore for the current fiscal.
Besides, the government has earmarked Rs 20,000 crore resource mobilisation through Market Stabilisation Scheme (MSS).
The government launched MSS in consultation with RBI in 2004 with the objective to absorb excess liquidity, arising out of significant foreign exchange inflows, by issuing treasury bills or dated securities.
As far as external debt is concerned, the liability is pegged at Rs 1.7 lakh crore for the next fiscal against Rs 1.56 lakh crore at the end of March 2011.
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In addition, the government is also liable to repay outstanding debt against the various Small Saving Schemes, Provident Funds, securities issued to nationalised banks, oil marketing companies fertiliser companies and civil deposits among others, it said.
During 2011-12, the government's dependence on market borrowings, pegged at Rs 4.17 lakh crore, against Rs 4.47 lakh crore as per the revised estimates of the current fiscal.
During the current fiscal, the government resorted to gross market borrowing of Rs 4.47 lakh crore, Rs 10,000 crore lower than the Budget estimate of Rs 4.57 lakh crore.
The net market borrowing of the central government through issue of dated securities in 2011-12 is estimated to be Rs 3,43,000 crore. Gross market borrowing in the 2011-12 Budget estimate is placed at Rs 4,17,128 crore taking into account scheduled repayment of Rs 74,128 crore.